Japan PM says closely watching China labor unrest

TORONTO, June 27 (Reuters) - Japanese Prime Minister Naoto Kan told Chinese President Hu Jintao on Sunday he was closely watching recent labor unrest in China where a burst of strikes has disrupted production at Japanese automakers.

A series of strikes, mostly at Japanese supply firms, has brought international attention to the prospect of rising wages in China, while jolting the industry and unnerving investors. [ID:nSGE65103V]

Kan brought up the issue in talks with Hu on the sidelines of a Group of 20 leaders' gathering in Canada.

"(Kan) said he was closely monitoring the various labor problems in China," a Japanese delegation official told reporters.

Hu told Kan he wanted to "deal appropriately" with the issue, the official said.

Japanese auto makers Toyota (7203.T) and Honda (7267.T) said last week that major car factories in south China halted work due to strikes at parts suppliers, the latest in a series of strikes over pay at parts suppliers in Guangdong and other parts of China.

Despite the latest strikes, the leaders of Asia's two biggest economies said they wanted to strengthen trade ties that benefit both sides.

Tensions remain between Japan and China related to their wartime past but both sides have stressed the need for closer relations given growing economic ties.

Bilateral trade grew to $266.8 billion in 2008, a rise of 13 percent from 2007, making China the top two-way trade partner of Japan, according to Japanese statistics. China was also the second-biggest destination for Japanese exports in 2008 after the United States. (Reporting by Chisa Fujioka; Editing by Peter Cooney)